Why Managing Nominations in C H S is So Clumsy -1

By I C Naik

The Nomination confers a right to receive and hold the flat and is not like a Will which enables the owner pass on the ownership upon his death. This simple truth has not received due attention in the Nomination procedure in housing society law. It may be because the legislative intention was of simplicity in managing the Society under “one flat one person” concept. It is however strange that this important matter has been nearly ignored in the Model bye-laws released by the Registrar of Cooperatives from time to time or perhaps the Nomination law has been grossly misunderstood.

In my story of West Bengal housing society titled “Daughter can be nominee: Understanding SC judgment” it can be seen that this aspect was considered secondary to nomination. In Indrani Wahi vs Registrar of Coop. Societies & ors [C A No.4646/ decided on dated 10 3 2016] the Apex Court has held:  “in case of a valid nomination, `the Cooperative Society’ is liable to transfer the share or interest of a member in the name of the nominee” Read full story….


Posted in From States on April 25, 2016 by Mr. I C Naik

The S C Order ends with a pointer that:” It shall however, be open to the other member of the family to pursue his case of succession or inheritance, if he is so advised, in consonance with law.”

Many protracted litigations could be expected reaching the Apex Court one day or the other. It is recommended that the Model bye-laws are strictly confined to a nomination process as laid down in MCS Act 1960 and the MCR 1961 to save the Committees from confusion.

In this series of three Posts it is proposed to have an over view of this simple law and procedure firstly, followed by complications in Model bye-laws 1984 (Part 2) and then in those issued in subsequent years (in 2001,2009 and 2014)- (Part 3).  Not many people may be aware that Officers in the Cooperative Department have internal instructions to insist on registering the latest Model bye-laws for new housing societies. Inviting suggestions from flat purchasers who will be joining the builder in making application for registration of the Society the promoters can register any Model with or without modificationiplease ra ss. Builders avoid as the Registering Authority will prevail over the builder to register the latest Model. The Builder haa no reasons to resent, and ones all his flats are sold he has no interest. Cases have come to light that the Deputy Registrar follows the provisions of the Bye-law Model 2014 in day to day matters even if the concerned C H S  has not adopted and registered them. Read a few recent true stories……… http://www.indiancooperative.com/cooperative-coffee-shop/maha-chs-tsunami-of-election-disputes-imminent/ and http://www.indiancooperative.com/from-states/how-a-dy-registrar-misguides-people-in-mumbai/  and http://www.indiancooperative.com/cooperative-queries/is-5yrs-for-mc-a-finality/

Currently many housing societies are operating on 1984 Model.

Nomination Law & Procedure in brief : [Sections are of the MCS Act 1960 and Rules are of the MCR 1961] :

1.On the death of a member of a society, the society shall transfer the share or interest of the deceased member to a person or persons nominated in accordance with the rules, provided that, such nominee is duly admitted as a member of the society [Sec. 30(1)]

2.Nomination should have been taken on record by the Society during nominator’s life time with name and address of the Nominee(s). [Sec. 30 (2)]

3.Where the nomination is made by a document, such document shall be deposited with the society during the member’s life time and where the nomination is made by a statement, such statement shall be signed by the member and attested by one witness. [Rule 25].

4.Record of Nomination [Full name and address of the person nominated by the member under Section 30(1)] [Rule 26] made in form “I”  showing the  name of the nominee and the date of nomination. Rule 32, Rule 65(1)(1) and Proviso to Sec. 38 (1)(e).

5.The nominee, may require the society to pay to him the value of the share or interest of the deceased ascertained in accordance with the rules [Sec. 30 (3)].

6.All transfers and payments duly made by a society in accordance with the provisions of this section shall be valid and effectual against any demand made upon the society by any other person. [Sec. 30 (4)]

At the cost of repetition, it must be reiterated as to how these 6 steps are summarized in a few lines by the Apex Court:  “in case of a valid nomination, `the Cooperative Society’ is liable to transfer the share or interest of a member in the name of the nominee” and “the other members of the family may pursue their case of succession or inheritance, if he is so advised, in consonance with law.”

Clumsier features in nomination process built in to Model bye-laws 1984 will be unfolded in Part 2.


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